Recommended Cash Offer - Pt 2

British Airways PLC
8 March 2001


PART 2



                                  APPENDIX I

              Conditions and Certain Further Terms of the Offer

The Offer, which will be made by Ernst & Young on behalf of the Offeror, will
comply with the rules and regulations of the Financial Services Authority and
the London Stock Exchange and the City Code.

Part A: Conditions of the Offer

The Offer will be subject to the following conditions:



(a)        valid acceptances being received (and not, where permitted,
withdrawn) by not later than 3.00 p.m. on the first closing date of the Offer
(or such later time(s) and/or date(s) as the Offeror may, with the consent of
the Panel or in accordance with the City Code, decide) in respect of not less
than 90 per cent. (or such lower percentage as the Offeror may decide) in
nominal value of the British Regional Air Lines Group Shares to which the
Offer relates, provided that this condition shall not be satisfied unless the
Offeror and/or any other member of the wider British Airways Group shall have
acquired or agreed to acquire, whether pursuant to the Offer or otherwise,
shares in British Regional Air Lines Group carrying in aggregate more than 50
per cent. of the voting rights then normally exercisable at general meetings
of British Regional Air Lines Group; and provided further that, unless the
Offeror elects otherwise, this condition shall be capable of being satisfied
only at a time when all other conditions have been satisfied or waived.  For
the purposes of this condition:

(i)         shares which have been unconditionally allotted but not issued
before the Offer becomes or is declared unconditional as to acceptances,
whether pursuant to the exercise of any outstanding subscription or conversion
rights or otherwise, shall be deemed to carry the voting rights they will
carry on being entered into the Register of Members of British Regional Air
Lines Group; and

(ii)        the expression 'British Regional Air Lines Group Shares to which
the Offer relates' shall be construed in accordance with sections 428 to 430F
of the Companies Act 1985, as amended;



(b)       the Office of Fair Trading in the United Kingdom or the appropriate
minister indicating, in terms satisfactory to the Offeror, that it is not the
intention of the Secretary of State for Trade and Industry to refer the
proposed acquisition of British Regional Air Lines Group by the Offeror, or
any matter arising therefrom or related thereto, to the Competition
Commission;

(c)        there being no provision of any agreement, arrangement, licence,
permit or other instrument to which any member of the wider BRAG Group is a
party or by or to which any such member or any of its assets may be bound,
entitled or subject, which in consequence of the Offer or the proposed
acquisition of any shares or other securities in British Regional Air Lines
Group or because of a change in the control or management of British Regional
Air Lines Group or otherwise, could or might result in, to an extent which is
material in the context of the wider BRAG Group taken as a whole:

(i)         any moneys borrowed by or any other indebtedness (actual or
contingent) of, or grant available to any such member, being or becoming
repayable or capable of being declared repayable immediately or earlier than
their or its stated maturity date or repayment date or the ability of any such
member to borrow moneys or incur any indebtedness being withdrawn or inhibited
or being capable of becoming or being withdrawn or inhibited;

(ii)        any such agreement, arrangement, licence, permit or instrument or
the rights, liabilities, obligations or interests of any such member
thereunder being terminated or modified or affected or any obligation or
liability arising or any action being taken thereunder;

(iii)       any assets or interests of any such member being or falling to be
disposed of or charged or any right arising under which any such asset or
interest could be required to be disposed of or charged;

(iv)       the creation or enforcement of any mortgage, charge or other
security interest over the whole or any part of the business, property or
assets of any such member;

(v)        the rights, liabilities, obligations or interests of any such
member in, or the business of any such member with, any person, firm or body
(or any arrangement or arrangements relating to any such interest or business)
being terminated, adversely modified or affected;

(vi)       the value of any such member or its financial or trading position
or prospects being prejudiced or adversely affected;

(vii)      any such member ceasing to be able to carry on business under any
name under which it presently does so; or

(viii)     the creation of any liability, actual or contingent, by any such
member,

and no event having occurred which, under any provision of any agreement,
arrangement, licence, permit or other instrument to which any member of the
wider BRAG Group is a party or by or to which any such member or any of its
assets may be bound, entitled or subject, could result in any of the events or
circumstances as are referred to in sub-paragraphs (i) to (viii) of this
paragraph (c);

(d)       no government or governmental, quasi-governmental, supranational,
statutory, regulatory, environmental or investigative body, court, trade
agency, association, institution or any other body or person whatsoever in any
jurisdiction (each a 'Third Party') having decided to take, institute,
implement or threaten any action, proceeding, suit, investigation, enquiry or
reference, or enacted, made or proposed any statute, regulation, decision or
order, or having taken any other steps which would or might reasonably be
expected to:

(i)         require, prevent or delay the divestiture, or materially alter the
terms envisaged for any proposed divestiture by any member of the wider
British Airways Group or any member of the wider BRAG Group of all or any
portion of their respective businesses, assets or property or impose any
limitation on the ability of any of them to conduct their respective
businesses (or any of them) or to own any of their respective assets or
properties or any part thereof;

(ii)        require, prevent or delay the divestiture by any member of the
wider British Airways Group of any shares or other securities in British
Regional Air Lines Group;

(iii)       impose any limitation on, or result in a delay in, the ability of
any member of the wider British Airways Group directly or indirectly to
acquire or to hold or to exercise effectively any rights of ownership in
respect of shares or loans or securities convertible into shares or any other
securities (or the equivalent) in any member of the wider BRAG Group or the
wider British Airways Group or to exercise management control over any such
member;

(iv)       otherwise adversely affect the business, assets, profits or
prospects of any member of the wider British Airways Group or of any member of
the wider BRAG Group;

(v)        make the Offer or its implementation or the acquisition or proposed
acquisition by the Offeror or any member of the wider British Airways Group of
any shares or other securities in, or control of British Regional Air Lines
Group void, illegal, and/or unenforceable under the laws of any jurisdiction,
or otherwise, directly or indirectly, restrain, restrict, prohibit, delay or
otherwise materially interfere with the same, or impose additional conditions
or obligations with respect thereto, or otherwise challenge or interfere
therewith;

(vi)       require any member of the wider British Airways Group or the wider
BRAG Group to offer to acquire any shares or other securities (or the
equivalent) or interest in any member of the wider BRAG Group or the wider
British Airways Group owned by any third party;

(vii)      impose any limitation on the ability of any member of the wider
BRAG Group to co-ordinate its business, or any part of it, with the businesses
of any other members which is adverse to and material in the context of the
group concerned taken as a whole; or

(viii)     result in any member of the wider BRAG Group ceasing to be able to
carry on business under any name under which it presently does so,

and all applicable waiting and other time periods during which any such Third
Party could institute, implement or threaten any action, proceeding, suit,
investigation, enquiry or reference or any other step under the laws of any
jurisdiction in respect of the Offer or the acquisition or proposed
acquisition of any British Regional Air Lines Group Shares having expired,
lapsed or been terminated;

(e)        all necessary filings or applications having been made in
connection with the Offer and all statutory or regulatory obligations in any
jurisdiction having been complied with in connection with the Offer or the
acquisition by any member of the wider British Airways Group of any shares or
other securities in, or control of, British Regional Air Lines Group and all
authorisations, orders, recognitions, grants, consents, licences,
confirmations, clearances, permissions and approvals necessary for or in
respect of the Offer or the proposed acquisition of any shares or other
securities in, or control of, British Regional Air Lines Group by any member
of the wider British Airways Group having been obtained in terms and in a form
satisfactory to the Offeror from all appropriate Third Parties or persons with
whom any member of the wider BRAG Group has entered into contractual
arrangements and all such authorisations, orders, recognitions, grants,
consents, licences, confirmations, clearances, permissions and approvals
together with all material authorisations orders, recognitions, grants,
licences, confirmations, clearances, permissions and approvals necessary or
appropriate to carry on the business of any member of the wider BRAG Group
remaining in full force and effect and all filings necessary for such purpose
having been made and there being no notice or intimation from the relevant
Third Party of any intention to revoke or not to renew any of the same at the
time at which the Offer becomes otherwise unconditional and all necessary
statutory or regulatory obligations in any jurisdiction having been complied
with;

(f)        except as publicly announced by British Regional Air Lines Group
prior to 8 March 2001 or otherwise fairly disclosed in writing to British
Airways or the Offeror prior to that date, no member of the BRAG Group having,
since 31 December 1999:

(i)         save as between British Regional Air Lines Group and wholly-owned
subsidiaries of British Regional Air Lines Group or for British Regional Air
Lines Group Shares issued pursuant to the exercise of options granted under
the British Regional Air Lines Group Share Option Schemes, issued, authorised
or proposed the issue of additional shares of any class;

(ii)        save as between British Regional Air Lines Group and wholly-owned
subsidiaries of British Regional Air Lines Group or for the grant of options
under the British Regional Air Lines Group Share Option Schemes, issued or
agreed to issue, authorised or proposed the issue of securities convertible
into shares of any class or rights, warrants or options to subscribe for, or
acquire, any such shares or convertible securities;

(iii)       other than to another member of the BRAG Group, recommended,
declared, paid or made or proposed to recommend, declare, pay or make any
bonus, dividend or other distribution whether payable in cash or otherwise;

(iv)       save for intra-BRAG Group transactions, merged or demerged with any
body corporate or acquired or disposed of or transferred, mortgaged or charged
or created any security interest over any assets or any right, title or
interest in any asset (including shares and trade investments) or authorised
or proposed or announced any intention to propose any merger, demerger,
acquisition or disposal, transfer, mortgage, charge or security interest (in
each case, other than in the ordinary course of business);

(v)        save for intra-BRAG Group transactions, made or authorised or
proposed or announced an intention to propose any change in its loan capital;

(vi)       issued, authorised or proposed the issue of any debentures or (save
for intra-BRAG Group transactions ) save in the ordinary course of business
incurred or increased any indebtedness or become subject to any contingent
liability;

(vii)      purchased, redeemed or repaid or announced any proposal to
purchase, redeem or repay any of its own shares or other securities or reduced
or save in respect to the matters mentioned in sub-paragraph (i) above made
any other change to any part of its share capital;

(viii)     implemented, or authorised, proposed or announced its intention to
implement, any reconstruction, amalgamation, scheme, commitment or other
transaction or arrangement otherwise than in the ordinary course of business
or entered into or changed the terms of any contract with any director or
senior executive;

(ix)       entered into or varied or authorised, proposed or announced its
intention to enter into or vary any contract, transaction or commitment
(whether in respect of capital expenditure or otherwise) which is of a long
term, onerous or unusual nature or magnitude or which is or could be
materially restrictive on the businesses of any member of the BRAG Group or
which involves or could involve an obligation of such a nature or magnitude or
which is other than in the ordinary course of business and which is material
in the context of the BRAG Group taken as a whole;

(x)        (other than in respect of a member which is dormant and was solvent
at the relevant time) taken any corporate action or had any legal proceedings
started or threatened against it for its winding-up, dissolution or
reorganisation or for the appointment of a receiver, administrative receiver,
administrator, trustee or similar officer of all or any of its assets or
revenues or any analogous proceedings in any jurisdiction or had any such
person appointed;

(xi)       entered into any contract, transaction or arrangement which would
be restrictive on the business of any member of the BRAG Group other than to a
nature and extent which is normal in the context of the business concerned;

(xii)      waived or compromised any claim otherwise than in the ordinary
course of business; or

(xiii)     entered into any contract, commitment, arrangement or agreement
otherwise than in the ordinary course of business or passed any resolution or
made any Offer (which remains open for acceptance) with respect to or
announced any intention to, or to propose to, effect any of the transactions,
matters or events referred to in this condition,

and, for the purposes of paragraphs (iii),(iv), (v) and (vi) of this
condition, the term 'BRAG Group' shall mean British Regional Air Lines Group
and its wholly-owned subsidiaries;

(g)        since 31 December 1999 and save as disclosed in the accounts for
the year then ended and save as publicly announced in accordance with the
Listing Rules by British Regional Air Lines Group prior to 8 March 2001 and
which in any such case is material in the context of the BRAG Group taken as a
whole:

(i)         no adverse change or deterioration having occurred in the
business, assets, financial or trading position or profits or prospects of any
member of the BRAG Group;

(ii)        no litigation, arbitration proceedings, prosecution or other legal
proceedings to which any member of the BRAG Group is or may become a party
(whether as a plaintiff, defendant or otherwise) and no investigation by any
Third Party against or in respect of any member of the BRAG Group having been
instituted announced or threatened by or against or remaining outstanding in
respect of any member of the BRAG Group which in any such case might be
expected to adversely affect any member of the BRAG Group;

(iii)       no contingent or other liability having arisen or become apparent
to the Offeror which would be likely to adversely affect any member of the
BRAG Group; and

(iv)       no steps having been taken which are likely to result in the
withdrawal, cancellation, termination or modification of any licence held by
any member of the BRAG Group which is necessary for the proper carrying on of
its business;

(h)        save as publicly announced in accordance with the Listing Rules by
British Regional Air Lines Group prior to 8 March 2001 or as otherwise fairly
disclosed in writing to the Offeror prior to that date by any member of the
BRAG Group, the Offeror not having discovered:

(i)         that any financial, business or other information concerning the
BRAG Group as contained in the information publicly disclosed at any time by
or on behalf of any member of the BRAG Group is misleading, contains a
misrepresentation of fact or omits to state a fact necessary to make that
information not misleading to an extent which, in any such case, is material
in the context of the BRAG Group taken as a whole;

(ii)        that any member of the BRAG Group or any partnership, company or
other entity in which any member of the BRAG Group has a significant economic
interest and which is not a subsidiary undertaking of British Regional Air
Lines Group is subject to any liability (contingent or otherwise) which is not
disclosed in the annual report and accounts of British Regional Air Lines
Group for the year ended 31 December 1999 to an extent which, in any such
case, is material in the context of the BRAG Group taken as a whole; or

(iii)       any information which affects the import of any information
disclosed at any time by or on behalf of any member of the wider BRAG Group to
an extent which, in any such case, is material in the context of the BRAG
Group taken as a whole; and

(i)         the Offeror not having discovered that:

(i)         any past or present member of the BRAG Group has failed to comply
with any and/or all applicable legislation or regulation of any jurisdiction
with regard to the disposal, spillage, release, discharge, leak or emission of
any waste or hazardous substance or any substance likely to impair the
environment or harm human health or animal health or otherwise relating to
environmental matters, or that there has otherwise been any such disposal,
spillage, release, discharge, leak or emission (whether or not the same
constituted a non-compliance by any person with any such legislation or
regulations, and wherever the same may have taken place) any of which
disposal, spillage, release, discharge, leak or emission would be likely to
give rise to any liability (actual or contingent) on the part of any member of
the BRAG Group and which is material in the context of the BRAG Group taken as
a whole; or

(ii)        there is, or is likely to be, for that or any other reason
whatsoever, any liability (actual or contingent) of any past or present member
of the BRAG Group to make good, repair, reinstate or clean up any property or
any controlled waters now or previously owned, occupied, operated or made use
of or controlled by any such past or present member of the BRAG Group, under
any environmental legislation, regulation, notice, circular or order of any
Third Party and which is material in the context of the BRAG Group taken as a
whole.

For the purposes of these conditions the 'wider British Airways Group' means
British Airways and any holding company, any subsidiary undertaking and any
associated undertaking thereof and any other undertaking in which British
Airways and/or any such other undertaking (aggregating their interests) have a
significant interest and for these purposes 'subsidiary undertaking', '
associated undertaking' and 'undertaking' have the meanings given by the
Companies Act 1985, other than paragraph 20(1)(b) of Schedule 4A to that Act
which shall be excluded for this purpose, and 'significant interest' means a
direct or indirect interest in ten per cent. or more of the equity share
capital (as defined in that Act).

The Offeror reserves the right to waive, in whole or in part, all or any of
the above conditions, except condition (a).

Conditions (b) to (i) (inclusive) must be fulfilled or waived by midnight on
the 21st day after the later of the first closing date of the Offer and the
date on which condition (a) is fulfilled (or in each such case such later date
as the Offeror may, with the consent of the Panel, decide).  The Offeror shall
be under no obligation to waive or treat as satisfied any of the conditions
(b) to (i) (inclusive) by a date earlier than the latest date specified above
for the satisfaction thereof, notwithstanding that the other conditions of the
offer may at such earlier date have been waived or fulfilled and that there
are at such earlier date no circumstances indicating that any of such
conditions may not be capable of fulfilment.

If the Offeror is required by the Panel to make an offer for British Regional
Air Lines Group Shares under the provisions of Rule 9 of the Code, the Offeror
may make such alterations to any of the above conditions, as are necessary to
comply with the provisions of that Rule.

The Offer will lapse if it is referred to the Competition Commission before
3.00 p.m. on the first closing date of the Offer or the date on which the
Offer becomes or is declared unconditional as to acceptances, whichever is the
later.

The Offer will be governed by English law and be subject to the jurisdiction
of the English courts, to the conditions set out above and to be set out in
the formal Offer Document and related form of acceptance.

Part B:  Certain further terms of the Offer

The Offer will not be made, directly or indirectly, in or into, or by use of
the mails or any other means of instrumentality (including, without
limitation, facsimile transmission, telex, e-mail or telephone) of interstate
or foreign commerce of, or of any facilities of a national securities exchange
of, the United States, Canada, Australia or Japan and will not be capable of
acceptance by any such use, means, instrumentality or facilities, or from
within the United States, Canada, Australia or Japan.  Accordingly, copies of
this announcement are not being, and must not be, mailed or otherwise
distributed or sent in or into or from the United States, Canada, Australia or
Japan and persons receiving this announcement (including custodians, nominees
and trustees) must not distribute or send it in or into or from the United
States, Canada, Australia or Japan or use such mails or any such means,
instrumentality or facility in connection with the Offer and doing so may
invalidate any purported acceptance of the Offer.

Notwithstanding the foregoing restrictions, the Offeror will retain the right
to permit the Offer to be accepted, if in its sole discretion, it is satisfied
that the transaction in question is exempt from or not subject to the
legislation or regulation giving rise to the restrictions in question.



                                 APPENDIX II

                   Calculations and Sources of Information

1.         General

Unless otherwise stated, (i) financial information relating to British Airways
has been extracted from the audited consolidated financial statements for the
financial year ended 31 March 2000, the unaudited interim statements for the
six months ended 30 September 2000, and the unaudited quarterly results to 31
December 2000 and (ii) financial information relating to British Regional Air
Lines Group has been extracted from the audited financial statements for the
financial year ended 31 December 1999, the unaudited financial statements for
the six months ended 30 June 2000, and the unaudited profit estimate for the
financial year ended 31 December 2000.

2.         Share Prices

The market price of a British Regional Air Lines Group Share is based on the
closing middle market price of 65.5p for a British Regional Air Lines Group
Share obtained from the Daily Official List on 1 December, 2000 (the last
business day before the announcement that British Regional Air Lines Group had
received an approach which might lead to an offer being made for the Company).

3.         Value of the Offer

References to the value of the Offer for the whole of the issued share capital
of British Regional Air Lines Group are based on 64,666,000 British Regional
Air Lines Group Shares currently in issue.








                                 APPENDIX III

  Profit estimate for British Regional Air Lines Group for the year ended 31
                                December 2000

 1.        Profit estimate

            The British Regional Air Lines Group Directors estimate that, in
the absence of unforeseen circumstances, profit before taxation, profit after
taxation and earnings per share for the year ended 31 December 2000 were not
less than £10.0 million, £9.7 million and 15.0p respectively.

            The estimates have been based on the unaudited interim results of
British Regional Air Lines Group for the six month period ended 30 June 2000
and the unaudited management accounts for the period ended 31 December 2000.


2.         Letter from KPMG on the profit estimate

British Regional Air Lines Group plc
Olympic House
Manchester Airport
Manchester
M90 1JE



KPMG Corporate Finance
2 Cornwall Street
Birmingham
B3 2DL



Cazenove & Co.
12 Tokenhouse Yard
London
EC2R 7AN



8 March 2001



Dear Sirs

British Regional Air Lines Group plc ('Company')

We have reviewed the accounting policies and calculations for the estimates of
profit before taxation, profit after taxation and earnings per ordinary share
for the year ended 31 December 2000 (together 'the Estimates') for the Company
and its subsidiary undertakings ('the Group'), set out in Appendix III of the
press announcement dated 8 March 2001 ('the Announcement').  The directors of
the Company are solely responsible for the Estimates.

The Estimates take account of the results shown by the unaudited Group
management accounts for the year ended 31 December 2000 and include the
results shown in the unaudited interim report of the Group for the six months
ended 30 June 2000.

We conducted our work in accordance with Statements of Investment Circular
Reporting Standards issued by the Auditing Practices Board.

In our opinion the Estimates, so far as the accounting policies and
calculations are concerned, have been properly compiled by the directors of
the Company on the basis set out in Appendix III of the Announcement and are
presented on a basis consistent with the accounting policies normally adopted
by the Group.

Yours faithfully



KPMG



3.    Letter from KPMG Corporate Finance and Cazenove on the profit estimate

British Regional Air Lines Group plc
Olympic House
Manchester Airport
Manchester
M90 1JE



8 March 2001



Dear Sirs

British Regional Air Lines Group plc

We refer to the estimates of profit before taxation, profit after taxation and
earnings per share (together 'the Estimates') of British Regional Air Lines
Group plc ('the Company') and its subsidiary and associated undertakings ('the
Group') for the year ended 31 December 2000, set out in Appendix III of this
announcement dated 8 March 2001.

We have discussed the Estimates, together with the basis upon which the
Estimates have been made, with the Directors of the Company.  We have also
discussed with KPMG the work they have done in respect of the Estimates as set
out in their letter dated 8 March 2001.

On the basis of the foregoing, we consider that the Estimates, for which you
as Directors are solely responsible, have been made after due and careful
enquiry.

Yours faithfully                               Yours faithfully
For KPMG Corporate Finance                     For Cazenove & Co.


Stephen Halbert                                Malcolm Moir
Partner                                        Partner




                                 APPENDIX IV

                                 Definitions

The following definitions apply throughout this document, unless the context
otherwise requires:

'Acquisition'                         the proposed acquisition of British       
                                      Regional Air Lines Group pursuant to the  
                                      Offer

'Act' or 'Companies Act'              the Companies Act 1985, as amended

'Australia'                           the Commonwealth of Australia, its        
                                      territories   and possessions

'British Airways'                     British Airways plc

'British Airways Board'               the board of directors of British Airways

'British Airways Group'               British Airways and its subsidiary        
                                      undertakings

'British Regional Air Lines Group'    British Regional Air Lines Group plc
or 'the Company'

'BRAG Group' or 'the Group'           British Regional Air Lines Group
                                      and its subsidiary undertakings

'British Regional Air Lines Group     holders of British Regional Air
Shareholders'                         Lines Group Shares

                                           

'British Regional Air Lines Group    the existing unconditionally allotted or   
Shares'                              issued and fully paid ordinary shares of   
                                     0.15p each in British Regional Air Lines   
                                     Group and any further such shares which are
                                     issued or unconditionally allotted and     
                                     fully paid after the date hereof and prior 
                                     to the date on which the Offer closes,
                                     (or such earlier date, not being earlier   
                                     than the date on which the Offer
                                     becomes unconditional as to acceptances or,
                                     if later, the first closing date
                                     of the Offer, as the Offeror may, subject  
                                     to the City Code, decide) including
                                     those which are allotted or issued upon the
                                     exercise of any options granted
                                     under the British Regional Air Lines Group 
                                     Share Option Schemes

'British Regional Air Lines Group    The British Regional Air Lines Group 1998
Share Option Schemes'                Executive Share Option Scheme and The      
                                     British Regional Air Lines Group Sharesave 
                                     Scheme

'British Regional Airlines'          British Regional Airlines
                                     Limited, a wholly-owned subsidiary of      
                                     British Regional Air Lines Group

'Canada'                             Canada, its provinces and territories and  
                                     all areas subject to its jurisdiction and  
                                     any political subdivision thereof

'Cazenove'                           Cazenove & Co.

'City Code'                          The City Code on Takeovers and Mergers

'Daily Official List'                the Daily Official List of the UK Listing  
                                     Authority

'Japan'                              Japan, its cities, prefectures, territories
                                     and possessions

'Listing Rules'                      the Listing Rules of the UK Listing        
                                     Authority

'London Stock Exchange'              the London Stock Exchange plc

'Offer'                              the recommended cash offer to be made by   
                                     Ernst & Young on behalf of the Offeror for 
                                     the British Regional Air Lines Group Shares
                                     and, where the context so permits, any
                                     subsequent revision, variation, extension  
                                     or renewal of such offer

'Offer Document'                     the offer document to be addressed to      
                                     British Regional Air Lines Group           
                                     Shareholders in connection with
                                     the Offer

'Offeror'                            The Plimsoll Line Limited, a wholly-owned  
                                     subsidiary of British Airways

'Panel'                              The Panel on Takeovers and Mergers

'Trustees'                           the trustees of the Sir Michael Bishop 1988
                                     Interest in Possession Settlement

'UK' or 'United Kingdom'             the United Kingdom of Great Britain and    
                                     Northern Ireland

'UK Listing Authority'               the Financial Services Authority acting in 
                                     its capacity as the competent authority for
                                     the purposes of Part IV of the Financial   
                                     Services Act 1986 and in the exercise of   
                                     its function in respect of admission to the
                                     Daily Official List otherwise than in
                                     accordance with Part IV of the Financial   
                                     Services Act 1986

'United States'                      the United States of America, its          
                                     possessions or territories, any state of   
                                     the United States and the District of      
                                     Columbia or any area subject to its        
                                     jurisdictions or any political subdivision 
                                     thereof

'subsidiary', 'subsidiary undertaking', 'associated undertaking' and '
undertaking' have the meanings respectively ascribed to them by the Act,
disregarding for this purpose paragraph 20(1)(b) of Schedule 4A to the Act.